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Power Lunch

News/Business. Sue Herera, Tyler Mathisen. Today's news on the economy, markets, real estate, media and technology. New. (CC)

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01:00:00

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TOPIC FREQUENCY

New York 19, Sandy 13, Us 13, Tyler 10, Simon 8, Manhattan 8, New Jersey 8, New York City 7, U.s. 6, Janet Napolitano 5, Brooklyn 4, Vince Reinhart 3, Julia 3, Fema 3, New Orleans 3, Steve 3, Steve Leisman 2, Napolitano 2, Jon Fortt 2, Katrina 2,
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  CNBC    Power Lunch    News/Business. Sue Herera, Tyler Mathisen. Today's news on  
   the economy, markets, real estate, media and technology....  

    November 1, 2012
    1:00 - 2:00pm EDT  

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>> that's all for us. catch more "fast" at 5:00 p.m. tonight. we'll follow this rally on wall street. big jobs report tomorrow. "power lunch" starts now. >> announcer: halftime is over. power lunch and the second half of the trading day starts right now. scott, thank you. this is new video from the metropolitan transit authority. that's the agency in charge of mass transit in new york city. look at the destruction there. that is the brooklyn battery tunnel flooded almost to the ceiling there. there's one of the subway stations close by. mayor bloomberg, governor cuomo are touring the damage today and we will be following along with them. now, even if your house an car are okay, what can you do? gasoline supplies are running low for cars and generators. coming up, we're going to map out the system to show you where the real bottleneck, the problems are. and, advice from new orleans to new york. they've been through this before in the port of new orleans. what are the lessons they
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learned and how can it help here in the new york metropolitan area? sue herera is off today. simon is in and at nyse. >> this is a good rally that we've got on the back of the economic data that came through today in advance, importantly, of tomorrow's employment report. you see this we are off our highs but it is still triple digit. volume is good. the volume yesterday actually by the end of trade wasn't bad. people want to trade the market and they're clearly sending it higher. let's bring in bob pisani for more. >> inflows, volume boarding on the heavy side, 3-1 advancing to declining stocks. dow jones industrial average, best day for the dow since september 13th when bernanke announced qe3. beaten up stocks are getting a bid. that's my theme today. look at some tech names. my heavens, what an awful month
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it's been for tech. these stocks were killed in the last month. but these are nice little bids here. intel up 3%. that's a rarity. how about financials? not great recently, particular some regions like pnc and regent's financial had a terrible month on their earnings. bank of america, highest close since april. jpmorgan also good. simon, you think the sandy play would be over, but no. trex, those waterproofing products -- >> you got to wonder if they're covering shorts in advance of the employment report perhaps, bob. >> they're buying on sandy pretty heavy on these stocks. >> >>ty, more later, back to you. a lot of economic data out today. some of it supposed to have come out earlier in the week, was delayed. shows an economy building momentum. that is at least until sandy came. steve leisman here. steve, is sandy going to slam
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the brakes on this slightly upward arc we're seeing in the economy? >> it is definitely going to have an impact on the economy. today we got a read on the economy ahead of sandy giving us really a baseline. that baseline was a little bit better than economists originally thought. at almost every count. perhaps the miss here -- what a nice graphic they made. perhaps the miss there was because they don't know how to estimate the new methodology. but that was better than expected. claims a little bit better than expected. ism above expectations also. construction spending powered by residential spending. government spending was tailing off there. consumer sentiment missed, but that was better than it was in the prior month. take a look at the ism manufacturing index in detail. we had this swoon, june, july, august, now it's popped back up above 50 for two months in a row. early to call a trend but good signs the sector ahead of sandy
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w was. as we've been talking about, sandy devastating a big swath of the country. folks, we're talking about the 12 to 15 states involved here representing about one-quarter of the nation's gdp. it would be crazy to think we are not going to see that show up in the data. probably at initial decline, followed by some bounce back when it comes to the rebuilding spending that's going to be going on. as for tomorrow, tyler, 125k is the estimate for payroll. 7.9%. a tick up in the unemployment rate from that controversial number. but just this number will not be affected by sandy because the survey -- >> it was collected earlier. >> see you in a few minutes. today's relatively strong economic data is welcome news for the president just days for the election. both campaigns back in a final full-court press. that is the new swing state
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data. also brings some welcome news for the president. our chief washington correspondent here with the latest numbers. hi, john. >> we've all been watching the national polls which show a dead-even race but really the race is going to be settled in the battleground states. we've got three new nbc news/"wall street journal"/maris polls of three of those states. first start with the state of iowa, in the heartland, every presidential campaign starts. president got a 6 percentage point lead, 50-44. that's very auspicious for him in a state that both parties are contesting. secondly, go to wisconsin. this is paul ryan's home state, one that republicans have been hoping to steal out of the democratic column. they haven't carried it since 1988. and you've got the democrats with a 3 percentage point lead, 49% for president obama, 46% for mitt romney. finally new hampshire, the only state in the northeast where mitt romney's a real threat to take away from democrats. president obama's got a 2 percentage point lead, 49-24. in all of these polls, we see
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that mitt romney is roughly even with the president on the -- who can best manage the economy. on their favorable ratings, mitt romney's has improved, but in each case the lead the president has among women is spllightly larger than the lead mitt romney has among men. simen? >> john, thank you. let's move from sandy and the road to recovery. baby steps i'm afraid still being taken in the city of new york today, including reports that manhattan power may be back online during the course of the weekend. until then, things appear to be getting tense. our senior correspondent scott cohn joins me now from lower manhattan. scott, i just heard firsthand that some residential buildings are now hiring armed guards because of the type of threat that they have faced from people attempting to loot as, of course, the police make those very regular trips during the night. >> reporter: that's entirely possible, simon. i haven't seen that directly, but i believe it. i want to give you a sense of
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some of what's going on here in lower manhattan. we're at the corner of maiden lane and water street. you didn't see it behind me because there is a beautifully timed bus here. but behind me is the aig headquarters. you may remember that from the bailout. takes a whole different form now. there's a chase bank branch there under water. it was underwater during the storm. it will not reopen any time soon. maiden lane takes you down to the east river but it is a good quarter-mile or so away. again, as i've been saying all day, the height of the water was up to here. just keep coming around here. it is a mixture of traffic. it is a mixture of people and people kind of pump out the water. that truck there is pumping water out of that building. it is a 500-gallon tank. every five minutes or so they durp out the water into the sewer system. normally you would need a permit for that in the city of new york, but they have suspended all the permitting. there's a restaurant that's not going to re-open any time soon.
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come back around here, a cell phone store. not that cell phones are a whole lot of use without power here. boarded up. we'll see whether that comes back any time soon. this gives you a sense of what is going on down here. normally this would be bustling with pedestrian traffic, regular traffic, people going about their business. now it is kind of mixing in with this rescue an recovery effort and hopefully this gives you a sense of why lower manhattan is not going to be the lower manhattan we know any time soon. tyler? >> scott cohn, thank you. our next guest is in the unique position to weigh in on both of the major stories of the day. big day for the economy and the market and the efforts of new york city to get back on its feet. "power lunch" exclusive now, we welcome jeff becker, ceo of ing u.s. investment management. ing is also the presenting sponsor at this weekend's new york city marathon. why don't we begin there. i realize that you run the investment management division, not all of ing in the americas, but you must have a perspective.
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a lot of new yorkers are very concerned -- some of them are angry -- that this marathon is going to go on as scheduled. did people from your company consult with the mayor, what did they say to him, to the extent you know, and do you support the decision? >> we do. the decision was taken by the mayor and the city of new york in consultation with the new york road runners. ing is the title sponsor. we support that decision. we're proud to be the title sponsor for the tenth year in a row. the marathon is a wonderful event for new york. it really represents the vitality and perseverance of new yorkers. it also has a tremendous economic benefit to the city of new york. the estimates are that annually, it gives annomi of $340 million to the city, and about $35 million to charities each year. >> it is a wonderful event, of that there is no disputing. was the company consulted by the mayor -- that's question one. and then question two is, your name is on this. if things go poorly, if there's
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a problem, what's the risk to your reputation? >> well, the city ultimately made the decision and it is their decision to take based on a very thorough analysis of the recovery efforts, the ability to move people throughout the city for the event, and ultimately, as you saw today with the airports opening, that we believe that -- and support the decision by the city and the new york road runners that we will be able to carry out an effective event. >> mr. becker, let me take you to the markets, if i may. if you were my investment manager, what would you be saying to me about the market at the moment? >> well, we think there are clearly a lot of issues out there in the markets right now. sandy, the most recent. but the elections, the fiscal cliff, the issues in europe. we think what's important for investors is really to take a long-term horizon and not to make knee-jerk reactions and moves based on these short-term events. sandy, as many have said, and we believe, will really have a
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v-term effect, if you will, short-term negative implications, but ultimately, as with irene, no lasting impact to sales, jobs and growth. that said, our hearts go out to those who have been impacted and experienced loss by the storm. >> i want to turn to one of the fund areas that you guys pioneered, the so-called target date funds that are sold under the premise that you're going to have a certain amount of money for you on a date certain, 20 30, 2045, and then a portfolio is managed for the best blend of risk and return given that target date. how are they doing? how has their performance been, and what is the risk that if i say, have a 2030 or 2035 target date -- not trying to personalize it here -- but what's the risk to you if the money isn't there, if the markets don't perform the way you thought? >> well, as you said, we were
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pioneer in target date fund investing. we began in 2005. we have $6.5 billion under management for in-plan options. december we'll launch a retail suite. but to your point about how are they performing, their intention is really to give professional money management and dynamic asset allocation to the average investor who can achieve their goals in a one-stop-shop within a single fund, if you will. >> are they working well? >> we believe they are. the way it works is that the asset allocation goes from a more aggressive to a more conservative asset allocation the closer you get to the retirement date. if you're near retirement right now, you're largely in fixed income securities and you're reasonably well protected. if you have longer than a five-year horizon, we believe the equity exposure is appropriate. >> mr. becker, thank you very much for joining us today. good luck to you. i have just been handed a press release foreign policy con
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edis edison. we said coned is in hopes to restore power by the majority of the weekend. it's not this weekend -- it is the weekend after! the weekend of the 10th and 19119 11th. it may be the majority of those 650,000 people do not have power through next week. and for some, they even say it will be the week after. i'm afraid real serious problems for the power supply and for a lot of new yorkers, that means no water and that also means no sanitation. let's make that perfectly clear because in new york you have to pump the water into your building and to the top of it in order to get the water to flow through. tyler, back to you. >> the yoordeals continue. conedison and the utilities sector in fact today negative as they all struggle to bring back power. to clarify what simon said, they are extending the timelines for full restoration but they still maintain that they should be able to bring lower manhattan back by this saturday. so they are maintaining this
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weekend for lower manhattan, but in the suburbs and outside of manhattan, they are extending it to the following weekend. if you read down to the third line there, simon, you will see that. that's what they were promising but nonetheless, it is clearly a longer timeline, a much more difficult resumption than a lot of folks had anticipated. >> when they make the caveat in this situation as big as you could actually drive three new york city buses through it, i pay real attention to that. bertha, i take the point. hurricane sandy certainly causing major disruptions to cell phones. did your phone let you when you needed it most? we'll tell you which is the smartest of the smartphones for an imagine like is it the iphone? the android? the blackberry? fears about gasoline shortages. mary thompson is at a gas station in new jersey. a lot of this has to do with the ability to power the pumps.
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>> reporter: you rex actually right, simon, with a lack of retail outlets available to sell what gasoline there is, long lines are forming in new jersey. i'll have that story coming up after the break. is steve. he loves risk. but whether he's climbing everest, scuba diving the great barrier reef with sharks, or jumping into the market, he goes with people he trusts, which is why he trades with a company that doesn't nickel and dime him with hidden fees. so he can worry about other things, like what the market is doing and being ready, no matter what happens, which isn't rocket science. it's just common sense, from td ameritrade. which isn't rocket science. when you take a closer look... ...at the best schools in the world... ...you see they all have something very interesting in common. they have teachers... ...with a deeper knowledge of their subjects. as a result, their students achieve at a higher level. let's develop more stars in education.
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you've seen the lines, the angry customers. you know the story -- there just
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isn't enough gasoline for everybody that needs it in the impact zone of this storm. before we go to our reporters from the latest -- for the latest from the front lines, let's take a step back and walk through the whole process from ground to pump. crude oil that is pumped from the ground is then transported by pipeline, tanker or barge to a refinery. and that's where the oil undergoes several processes, changing it into many products. but mainly for this purpose, gasoline. from there it is shipped, usually again through a pipeline, to a terminal. at these terminals gas is stored in big huge tanks and it may go through more blending with additives like ethanol and other things that are mixed in to the fuel before it is loaded on to tanker trucks which then deliver the fuel to retail gas stations. now here's the problem. ahead of hurricane sandy, what happened? well, some of the refineries on the east coast were taken offline. idled, completely shut down. they are coming back online and
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doing their job, but it can take several days to get operations back to normal. now even as the refineries get back to normal, the problem here is that most terminals in the new york city area are still without power. they have been shut. they can't take on more fuel and they can't pump it out because the pumps run on electricity. that is where the real bottleneck is now. at those terminals, trying to get the supply out on to the trucks and to the gas stations. of course, consumers feeling the pain at the pumps, long lines, limits on how much you can fill up, and some stations in the storm's path, they, themselves, still shut down with no power. mary thompson is live at one of the gas stations in ridgefield, new jersey, where there is actually power and they are pumping it out. >> reporter: there is power, tyler, there is gas and there are very long lines. tyler, you know very well that patience is a virtue. it's the necessity post-sandy.
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a lot of gas stations aren't open, and those that are, they might as well have a red velvet rope at the entrance. >> took about two hours, i think. if you have to do it, you have to do it. this is the only place you can come and get gasoline. >> well, we've been waiting here for -- what? over two hours trying to get gas. we're working up in new york city with the flood relief trying to clean up some of that water. we haven't made it there yet. >> reporter: what's behind the long lines? first and foremost, a lack of electricity. gas stations without power, they just can't pump gas. second, some stations that have gas may run out quickly. the new jersey gasoline retailers association says the average station has about a 30,000-gallon tank. on a normal day, it turuns throh one-third of that, about 10,000 gallons. but in a post-sandy world it is going to run through that much sooner. last week some important cogs in the supply chain are without
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power or damage. the solution for now, truck in gasoline from out of state, something that's been made easier, given a waiver signed by new jersey governor chris christie. additionally, the epa is waving clean gas requirements along the east coast through november 20th so assure adequate supply after sandy. but again, the real problem right now is the lack of power. tyler, back to you. >> i'll toss it down to simon. >> tyler, let's take it back up a step. as you said, the hold-ups are also coming through in the storage facilities, the storage facilities are as important as, of course, we just heard from the pump face there. kate kelly is at a terminal in new jersey for more on that. kate? >> reporter: simon, things are very grim here in new jersey, standing next to an administrative building that was battered in the storm. in the coming days, workers
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wearing steel-tipped boots will be walking through things like raw sewage, stimber and reeds i order to retrieve company documents. glass is shattered, the refrigerator is floating and they've even seen raccoon tracks inside. this isn't even where they store the all-important fuel. terminals like this one, about 15 to 20 of them in this area of northern new jersey, in new york harbor, are key to getting critical fuel supplies to the new york region. but before -- >> we're estimating right now -- we're still in the assessment process -- four to six weeks to get our marine facility back up. we not only look to the integrity of what's in the tanks but the integrity of our marine facility. >> reporter: before bergman can get those tanks operating again you must make sure his pump boaters are working. he's now considering sending the motors to oklahoma to be fixed through a system he calls hot
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starting. that's putting two guys in a tractor-trailer to drive, taking turns at the whole so they don't have to stop for anything longer than a bathroom break, simon. right before we came on, we got an update to our earlier story which is to say a back-up generator they were depending on has not yet arrived so it is unlikely they're going to get refilling trucks in to their truck racks today in order to get that all needed gas to gas stations in the area. on the up side, the local mayor says that this facility is likely to have power as of midnight tonight, simon. so that generator may not be needed after all. >> what is clear is clearing up the mess after the hurricane is a process. it is not an event of any of the ripple effects that you see. kate, for the moment, thank you very much. ahead on the program, we're going to tell you which is the smartphone that will best be used through an emergency like a hurricane. the iphone, android or blackberry? we have it for you on cnbc. plus, investors dumping pandora's stock recently on news
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apple is starting its own music service. pandora's ceo will join us in a first on cnbc interview to lay out his plans for taking on those big tech titans. gecko (clearing throat) thank you, mr. speaker, uh, members of congress. in celebration of over 75 years of our government employees insurance company, or geico...as most of you know it. ...i propose savings for everyone! i'm talking hundreds here... and furthermore.. newcaster: breaking news. the gecko is demanding free pudding. and political parties that are actual parties! with cake! and presents! ah, that was good. too bad nobody could hear me. geico. fifteen minutes could save you fifteen percent or more on car insurance.
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overall but again, it's in line. little disappointment there. >> bertha, thank you very much. keeping an eye on pandora. the internet music company trading higher today after unveiling new mobile apps on monday but it's had a rough couple of days an even a worse year, down about 40% in the stock market. julia boorstin has a first on cnbc with the ceo of pandora. julia? >> reporter: that's right. we're joined now by joe kennedy, ceo of pandora, on the heels of pandora's biggest ever app update. joe, thanks for talking to us today. >> great to be with you, julia. >> i have to start off asking you about competition. your stock plummeted last week on news about apple working on a free streaming music service, and microsoft's xbox music just launched its free app supported streaming. how are you going to tackle this growing competition? >> we've been tackling competition for over seven years since we launched the service. when we launched microsoft, aol and yahoo! were actually the
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dominant players in internet radio an we've seen all sorts of new entrants large and small over the year's clear channel venture funded starts, et cetera. today we have the largest share of internet radio listening we've of had and the largest share of total radio listening we've ever had because we have focused on delivering the best personalized radio experience in the world. and any new entrant has to answer the question -- why should you, julia, stop listening to your pandora stations and listen to their new service? we work hard every day to make that a very difficult question to answer. >> but, joe, if apple has 400 million itunes users, there's no denying that a new service from apple, which my sources tell me will launch some time early next year, could really challenge your usage on apple's devices. >> well, we ourselves just passed 175 million registered users just in the u.s. so apple certainly has a worldwide user base that's
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considerable, as you mentioned. but our scale in the u.s. is very significant. again, i think it circles back to what is the best personalized radio experience in the world. we deliver that today. we make it very hard for anyone to answer the question why you should stop listening to your pandora stations. >> i understand pandora has been lobbying congress to pass internet radio fairness act to lower those set licensing fees which eat up a big chunk of your revenue. that's your plan if this bill doesn't pass? >> well, there is an arbitration process that will take place in 2014 and 2015 that will separate 2016 through 2020 for all internet radio. we're fully prepared to enter that arbitration process and would look forward to making the case for rates that are more fair than what we see today. the bill changes the legislative guidance to the arbitration panel to make that guidance consistent with the guidance that congress has given for
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satellite radio rate setting and for cable radio rate setting which we think is more even. but even if that bill is not passed, we look forward to the arbitration in 2014 and 2015. >> great. we look forward to seeing what does happen with that internet radio fairness act. unfortunately, we're very tight on time today. we appreciate you taking the time to talk to us and hope to have you on again scene. back over to you, tyler. >> julia, thank you. let's go to breaking news, some video of a tour of the brooklyn battery tunnel. there is mayor bloomberg, andrew cuomo the governor of the state of new york and joining those gentlemen is janet napolitano, secretary of homeland security. we expect some remarks to be made and if there's any newsworthy commentary that comes out of these discussions we'll bring it to you as quick as we can. mean while, it is day two of open markets in the wake of super storm sandy. say that ten times fast! the dow industrials up 112. the s&p higher by about 1%.
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and the nasdaq by more than 1%, 33, almost 34 points. a slew of positive economic data coming out today. we have former fed official and current chief u.s. economist vince reinhart. he'll discuss sandy, the looming fiscal cliff and the election now just five days away. we'll be right back. ♪ [ male announcer ] the way it moves. the way it cleans. everything about the oral-b power brush is simply revolutionary. oral-b power brushes oscillate, rotate
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we're watching an event in downtown new york. that's the head of the metropolitan transit authority. flanked by andrew cuomo, the governor of new york. we are waiting some comments from homeland security secretary janet napolitano and we'll watch all of these remarks for any newsworthy developments especially from secretary napolitano. meanwhile, michelle crew co-cabrera is here with the latest headlines of the storm and its aftermath. >> we see what's happening in new york city today, president obama met with new jersey governor chris christie yesterday doing a similar tour in new jersey. the president toured some of the worst hit areas of the jersey shore. saying 2,000 fema personnel are on the ground in affected areas. at least 82 people have died in the u.s. as a result of sandy. most of them in new york and new jersey. the number of people without power is dropping, though there are still 4.5 million customers
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in the dark and it may be ten days before the hardest hit areas see their power restored. meantime, nearly 20,000 flights were canceled because of sandy but stranded airline passengers are finally getting some good news. limited number of flights are taking off from laguardia this afternoon. all three major area airports are now open. airlines are waiving changeance a and cancellation fees due to the storm. dedubtable on insurance claims will be discounted. fema would usually cover only 75%. governor cuomo is asking for full reimbursement. we are still awaiting the possibility of janet napolitano speaking, the first federal official to do so at the mouth of the brooklyn battery tunnel where she's with cuomo at the moment. gold is closing as we speak.
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sharon epperson has the action live from the new york merc. >> not a lot of action in the gold market here. traders just returning for the first time since hurricane sandy to the floor. as we wait, key economic data coming out tomorrow. we are looking at those traders waiting to see about that information, watching the strength we're seeing in the stock market as well as a little bit of strength in the dollar. that's pressured gold and silver a little bit an then the one part of the metals complex that has been a bright spot has been copper. positive data out of china. pmi data this morning definitely helping that side of the metals complex. >> it is worth mentioning again of course the strength of the rally today. it is still a triple digit gain. we've given up some of the ground but triple digits on good volume ahead of the employment report tomorrow. first day of the month and we are actually getting real in flows, 3-1 advancing to declining stocks. you usually see some kind of
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volume inflow. look at dow, off of the highs but earlier we had the best day of the month since september 13th when the fed announced qe3. winners and losers, beaten up stocks getting a bid. tech stocks had a terrible month. nice move here. u.s. steel has had a terrible second half of the year but getting a nice bid. all on the upside. same with industrials. haven't had a particularly great quarter for a stock like cummins. eaton, caterpillar, as well. still on the upside. building products, the gift that keeps on giving for those who have been playing sandy for the last week. still up today. let's head to the nasdaq and seema mody. seema, wr we were asking earlier whether the strong showing in techs today is short covering or something more pronounced? >> i think we're having a strong day here at nasdaq mostly due to that better than expected
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economic data we got out this morning. thding a nice lift to the nasdaq. we're up more than 1%. old school tech names that bob mentioned as well -- microsoft, intel posting strong games. interestingly enough, if you look at a one-week chart of microsoft versus apple, microsoft shares have been gaining momentum, up nearly 5% versus apple which is down about 2%. lastly, look at our best performing stock, research in motion, up 8% on optimism that its new blackberry 10 device is on track to launch in the first quarter of 2013. >> cool, seema. thank you. new economic numbers point to stabilization in the labor market ahead of tomorrow's jobs report. but will hurricane sandy derail any traction in jobs and economic growth? to discuss that and more we're joined by vince reinhart, chief u.s. economist and morgan standy, also former head of the federal reserve's monetary division. welcome back. glad to have you with us. start with the storm. what effect on net do you think it will have on the nation's economy?
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>> well, it is a little cold to talk about the economic consequences with all this construction. if you are going to talk about the economy, the first thing to recognize is this is enormous hit to our wealth. we just -- the storm destroyed a significant capital and infrastructure in the affected areas. and that will leave imprint on activity for a bit to come. first there is destruction and deferral. there's destruction of some demand. if you can't go out and spend, you're not going to be able to spend if you lost some income, you're not being able to spend. there will be, however, some deferred spending. if you had decided to buy a refrigerator, then you didn't buy it this week, you'll buy it next week, or the week after. that will get captured within the quarter and then after this quarter we'll see the rebuilding efforts to try to recapture some of that lost capital. zplul's see some spending on replacements such as for lumber, automobiles and so forth.
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steve leisman joins us, vince. >> you know, tyler, one thing you talked about was stabilization. i wanted to ask vince about that. vince, numbers today were better than expected. not tremendously better than expected. even if they were a lot better than expected, they wouldn't be that high. how important is it that the economy seems to be sort of in a -- at least improving from the summer swoon going into this event? >> that's important. the economies do hit stall speed when you're flying the plane slower and closer to the ground, you're more susceptible to bad things happening with the wind shear. it is not just a storm event. we've got to worry about fiscal consolidation in the first half of 2013. so it does help and rebuilding will help in the first half of next year but for now we got to get past the event itself. >> vince, i liked what you said at the beginning about this idea of wealth destruction. obviously i don't like that concept, but a lot of people think this would be an additive to growth.
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people don't understand if you have a house destroyed, it detracts if you don't build back that exact house or unless you build back a better house. that's really what depends on the total effect on wealth. i think we should disyou a bus people of this notion that destroying property assets and equipment is something that can add to growth. >> particularly, steve, when you're destroying infrastructure. those rail tracks ripped up. that means that rebuilding will add to activity but the cost and the less freight going over those rails takes away, too. >> vince, turn to the fiscal cliff. how big a threat do you think it is to the economy over the next three to six months, and how do you think it will resolve? i assume that you think the resolution will depend on who wins on tuesday. >> i think elections matter for lots of things, including fiscal -- the fiscal cliff and also attitudes to many aspects of tax licy environment, energy and the like.
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so the world's a risky place and this is a time of heightened uncertainty. now we talk to clients, we do surveys and our own analysts and they say the material drag on demand looking forward already this year. we think that's why we're a little bit below trend in overall demand growth. and the reality is, any way you slice it there will be some fiscal consolidation in the first half of next year. >> i think it is critical that you get business back on-board. one of the interesting things has been the consumer seems to be holding in there the retail sales numbers have been a lit better, consumer sentiment numbers have been a little better. business equipment and spending numbers haven't. if you can get both those cylinders firing, you could start inching away at the unemployment rate. >> vince, is your baseline hypothesis that something gets
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done either right before the close of the year or right after the start of the year, no matter who wins, to sort of ameeliorat the situation? >> politicians always do something at the last minute. the problem is the fiscal cliff really isn't a cliff. it could be a shallow incline and the last minute could be as late as the middle of february. >> vince reinhart, thank you very much. continued good luck to you. thank you for being with us. steve, thank you as well. let's just go to the scene of the new york stock exchange. mouth of the brooklyn battery tunnel which was one of the first to be closed in anticipation of the hurricane by the governor. we're still awaiting the statement from janet napolitano which may be significant as the first federal official to talk obviously from the vantage point of secretary of homeland security. but possibly about funding for the tragedy certainly in this state, cuomo has asked for more funds than would be normal from the federal government. as soon as we get that, we'll
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bring it to you. certainly it is clear that hurricane has left a devastating wake in its path with communities trying to pick up the pieces. we'll get advice from the man in charge of the port of new orleans next on how to maximize the rebuilding efforts through his experience. stay with us.
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secretary of homeland security janet napolitano in new york city right now. >> -- our city can be confident that this recovery will be as speedy and as efficient as possible. senators schumer and gillibrand, really appreciate the support. those of you should know that these are regular correspondents with me and have been on the phone with me several times since landfall of this hurricane. representative nadler, speaker silver, also everybody's really involved. so what does that mean. well, it means a couple of things.
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number one, the president has declared a number of counties in new york, new jersey and connecticut disaster areas, and that means that individuals can begin applying for assistance for things like temporary housing, for things -- and communities can apply for emergency protective measures they have had to take. go to disasterassistance.gov. go to fema.gov. there's also a 1-800 number that i can't read because it's reflecting off of my ipad. but there is a 1-800 number. in addition -- >> 613362. >> thank you, senator. >> since we turned on the assistance clock, more than 36,000 individuals have already signed up. we want to make it as easy and as convenient for people to do this as possible. we know some people don't have
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phones or access to the internet right now. we literally have hundreds of teams now -- >> we're going to monitor secretary napolitano for news and will bring it to you as it warrants. meantime, we want to show you these before and after pictures from google earth. this is before the storm hit in mantoloking. then you see where the storm surge cut right through that stretch of barrier island and washing away part of it. this is seaside heights, new jersey. garden staters flock to this amusement park on the shore every summer. it is an iconic destination. this is now what it looks like after the storm. so much of that park washed into the ocean. simon? >> terrible. in order to help alleviate gas shortages here on the east coast, the port of new york has just reopened the fuel transports. our next guest noknows what
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critical steps need to be taken in the days and months following a critical disaster. he got the port of new orleans up and running after hurricane katrina in 2005. gary lagrange joins us now from new orleans. welcome to the program. it is good to see you here. if the port of new york were to make a call to you and say, look, gary, you've done this before, what should we do? what would you say to them? >> well, first, i think the port of new york, new jersey is in great hands. admiral rick larabie has weathered the storm many times before. the communications aspect is first and foremost about anything. the pilots, noaa, coast guard, army corp of engineers, all staying in touch with each other to ensure that the port and the harbor can open just as quickly as possible to assure that the safeguard and movement of commerce is first safe, but also expeditious as well. because of the magnitude of a port like new york, new jersey, just is an absolute must. a huge market area. many consumers relying on it.
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>> more broadly, ceos who are obviously attempting to hold businesses together and ensure that they function, many of them in a very, very difficult situation. what would you say to them? >> i think that we got to do exactly what you're doing right now, communications. you've got to go to mass media, you've got to get to your customers around the world, let your customers around the world know when the port's going to open, re-assure them that their goods are safe and that the port will be safe for good movement. you don't want any of the ships to divert to other ports. you want to maintain continuity with the consumersed a with the market area that's there for the port of new york-new jersey. same thing is true on the flip side for european countries, south america and also the asian countries as well. they're relying on goods to be exported out of new york-new jersey and other major ports on the east coast. >> and what about employees in this environment, those who obviously may not be able to get to work because mass transit isn't working, but at the same time might also be worried about
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paychecks coming through. >> yeah. well, that's an interesting question. that was several hours after hurricane katrina. a call from the white house asking what we needed. it was reaction answer at first -- we needed food, blankets, water. what's really needed is manpower, electrical power and also intermobile connectivity, bridges, roads, access to mid-america, to your market area's got to be open so those goods can move. that's an absolute must. how the workers get to work is going to be an issue that's got to be dealt with because it is absolutely vital. manpower is number one, even above electrical power. otherwise you have no port, have you no operations. >> it is good to see you, sir. thank you for the advice. gary lagrange, the ceo of the port of new orleans. thank you. time to look at the number of people still without power in the northeast. as you see, new jersey almost 2 million. new york, 1 1/2 million. many of those in lower manhattan
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and out on long island. meanwhile, with the road to recovery under way, what is the best smartphone to have in an emergency? jon fortt is in san jose. jon? >> reporter: tyler, used to be blackberry was the go ln to phone hands down. but in this era of apps and accessories, the landscape has changed a bit. i'll tell you how after the break.
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s&p 500 up 12 1/2 points as we welcome you back to "power lunch." i believe we have some images over staten island. we just had them a moment ago. one of the hardest hit of the five boroughs of new york city and where the marathon will begin on sunday. what is your best smartphone in a disaster? jon fortt in san jose has the options. >> hey, tyler. phonewise, there are really three things to think about when calamity strikes. can you keep a phone call, can you keep tabs on the latest information and will your battery last. there's no one type of phone that's the best of all three but let me walk you through some of the trade-offs. blackberries are great at phone calling. my blackberry can get a signal
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where my iphone just can't. if you're in the type of emergency where you are stuck in one spot, can't roam around, that helps. next, apps. why does this matter? in emergencies social media is the new e-mail. can you follow emergency response on twitter, let your facebook friends know you're okay, even ask others for help. iphones and androids tend to handle social media better. then there is the battery. if you can plan ahead, you can get an external charger for iphones and android devices that uses aa batteries. we'll bring up on the screen something like this energizer charger. you can't swap out the battery in an iphone but this is arguably better because you can keep as many aa batteries onhand as you can stock in a closet. bottom line, if a completely unexpected disaster hits, it is nice to have a blackberry or plain old feature phone. but if have you any time to plan, get accessories, i phone and android definitely have their advantages. you can save battery life on your smartphone by dimming your
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screen and using a slower cellular seconds. car dealers lost several days of sales due to sandy. we'll take a look at that next. tridion safety cell y which can withstand over three and a half tons. small in size. big on safety. who have used androgel 1%, there's big news. presenting androgel 1.62%. both are used to treat men with low testosterone. androgel 1.62% is from the makers of the number one prescribed testosterone replacement therapy. it raises your testosterone levels, and... is concentrated, so you could use less gel.
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